The mindset that win in recession

Minister for Finance, Kemi Adeosun PHOTO: SUNDAY AGHAEZE/STATE HOUSE

Minister for Finance, Kemi Adeosun PHOTO: SUNDAY AGHAEZE/STATE HOUSE

It is often said that a crisis is a precious thing to waste. What determines whether we see a crisis as a blessing or a curse is our attitude. Attitude is everything. It is usually not what happens to us that matter most for the quality of our life. It is how we comprehend what is happening. This is where we must distinguish between realism and pessimism. A realistic mind acknowledges the facts and do not live in denial. The obvious fact today is that economic challenges we face today are dire and distressing. No amount of sweet talk can change the reality that most graduates are not getting employment and many more cannot easily start businesses on their own because of a combination of lack of entrepreneurial skills and positive policy support. But it does not stop there. How do we see the giant in the room? As a giant that we can defeat?

Biblical stories often are powerful lessons in managing tough time. Think about what happened with the people of Israel when they attempted to enter into the promise land. The promise land could represent any set of strategic goals. In today worlds, it could mean for a young man in Nigeria how to earn enough money to take care of him and his immediate family. For managers of the national economy it could mean how to create meaningful jobs for the youths and stave off hunger and starvation in a period of collapsed commodity trading.

Then there are the giants standing between the dreamer and his dreams; between the business manager and the bottom line or between public officials and their campaign promises. The giants may be a permanent feature of the landscape or may have suddenly sprung up. According to the futurist, Nassim Nicholas Taleb, there is the possibility of a black swan, an unpredictable and therefore difficult to manage event. In the bible story, the black swan event is the presence of the giants. The Israelites did not reckon with the giants in planning their movement to the promised land. It was only when they engaged in empirical data gathering that they discovered the unforeseen problem, a black swan event. This is how it goes with a corporate or political plan. If we are clairvoyant and analytical we may see a recession warming up in the horizon. But even at that, we may still with our best analysis fail to see how deep or in what form the recession may take. No two recessions are the same because the dynamics of their interactions with the myriad human and nonhuman phenomena in the social setting means that we cannot perfectly script the impacts of recessions. It is for reason of such unpredicted happenstances that it is often said that no battle is won on the conditions of the original plan.

The bible account presents two different reactions to the presence of the giants. The first reaction, which is usually the default reaction is to panic and give up on strategic goals because of the black swan event. The second and the less intuitive reaction is to acknowledge the black swan event but restate commitment to the strategic goal. We don’t wish away the difficulty. But we are determined to walk around the problem. That is the spirit of excellence. It is the leadership mettle of those who will lead out of recession.

We take the world as we see it. But we don’t react to the world on the first impulse. It is the responsibility of every leader to think hard about the challenges arising from recession. Our knee-jerk response born out from intuitive thinking may not lead to the success when the landscape has drastically changed. We then need to engage type 2 thinking, what the psychologists and Nobel Laureate in Economics, Daniel Kahneman, in his book, Thinking, Fast and Slow, calls Type 2 thinking. Type 2 thinking parses through the facts to have a better view of the world before making decision. The critical fact about Type is due diligence. We pay attention to the facts of the matter. We assess the situation, factoring all relevant factors. That is what is meant by critical thinking and facing reality.

But facing reality does not mean that we accept defeat. It does not mean that we give up. Part of the Type 2 thinking is creativity. It is thinking outside the book, believing in our ability to surmount the obstacles. Those audacious Jews who believed that they could face the giant were not just whimsical. They were not bluffing. They assessed the situation, considered their strength and weakness and knew that they could win the battle only if they optimized their advantage. By the way, their advantage is that they have Jehovah as their Commander-in-Chief. The little guys could slay the giant if the little guys properly recognized and optimized their strength.

Malcolm Gladwell wrote David and Goliath to explain the phenomenon of the little guy slaying the giants. It is all about how we analyze the situation and deploy our competitive advantage. We can’t deploy competitive advantage if we don’t have a balanced view of the difficult situation. This is the meaning of the saying ‘every cloud has a silver lining’. There is a golden opportunity in the midst of the troubles. As the Chinese say, crisis could represent a difficulty or an opportunity.

So, what determines whether we see the giants as surmountable or as invincible? What determines whether a nation will come out of a crisis stronger or weaker? It turns on three clear factor. The first, is inspiration. The second is resilience. And the third is execution.
Unfortunately, many people wrongly think that the time of recession is a time to hunker down, stop the gigantic project, trim your sail and make for the nearest safe harbor. This is just intuitive. This is Type 1 thinking. Responding as it is apparent. But, this is a wrong response. The time of recession is a time to renew inspiration. We have to remain inspired. One of the first negative effects of recession is to drain optimism. Without optimism we cannot set out in difficult times and tough terrains.

How do we remain inspired during tough times? The best guide is to have a strong personal vision. It is the vision that provides inspiration and sustenance during tough times. There would be no strategic action without a strategic vision. If this vision is built through a process of data gathering and analysis and mixed with imagination, it is able to adapt to the challenges posed by the black swan event. Visionary people are able to read into every context their personal story and value system. So, those who are committed to excellence will also find in every new context a pathway towards excellence. The reason this is so is because they built their strategic vision on a core value that define their purpose and values in life. So, with the help of a vibrant imagination they are able to continually revise their game plan in the face of new challenges without abandoning course or sailing rudderless.

The second factor for succeeding in recession is resilience. Resilient people are strong to withstand difficult times and tides. Resilience is the height of moral courage. It is perhaps the most important requirement of sustainable success. This is because we can never know when difficult time will come and so only those who are built-to-last will have a guarantee of lasting success. According to Andrew Zolli, the author of ‘Why Things Bounce Back (2012) resilience is ‘The capacity of a system, enterprise, or a person to maintain its core purpose and integrity in the face of dramatically changed circumstances”.  It is the capacity to succeed and survive.

Lareina Yee, in an article in a McKinsey Quarter 2014 defined resilience as “the capacity to recover quickly from difficult- a form of toughness”. Resilient people are resolute, courageous and confident. As businessmen, resilient people are able to get up after making a mistake. They have grit that enable them to rise above challenges and the confidence “to transform challenging experiences into greater self-assurance, not self-doubt”.

There are some essential qualities of resilient people. They include having a purpose in life. Resilient people are purposeful. Because they are ethical, they are irreversible about values and vison by flexible and reversible about how to achieve strategic vision. Resilient people are faithful in abiding by their principles and values. They are people of integrity. They can differentiate between what counts and what can be counted. Resilient people are perceptual. They know what is changing and what does not change. They stay lean and trim so they can easily adapt. But even as they cautious and deliberate they nevertheless are action-oriented. They know that boldness is genius.

Taking action is the last of the three factors of succeeding and surviving in a recession. Inspiration is at the level of strategy. Execution is at the level of operation and tactics. Success and failure in a recession is better determined by the skill in executing strategic choices arising from strategic vision. Many companies have gone down during recession not because they managers lack the inspiration and resilience to withstanding the storms of the season. Rather the faltered on the offensive rock of poor execution. The plan is as good as its execution.

To execute well in a recession, the visionary and courage business or organizational leaders must have realism about the execution process. Good execution entails good execution process. Unless and until we map out a coherent, realistic and implementable process map our vision and resilience may avail nothing. Many leaders fail in executing their vision because they fail to pay serious attention to execution as process that must to the strategic vision and choice we have made.

What is the best methodology for ensuring that we create a good execution process? The best way is to adopt the model of asking relevant question. We must ask all the relevant questions at the beginning of execution and at every stage of execution. Good questions help us to factor all the incidents of the changed landscape of our business enterprise. Next week we discuss more on the nitty gritty of good execution as we discuss the three pillars of success.

Dr. Sam Amadi is the Chief Ideas Officer, 6th Sense Consulting Abuja, Nigeria 234-803-329-9879



No Comments yet

Related